Financial Definition of CLOSING PRICE

closing price

What It Is

A closing price is the trading price of a security at the end of the trading day. In real estate, it is the price at which a piece of property sells.

How It Works

The New York Stock Exchange has the most famous closing bell (so famous that the term has a service mark). At 4 p.m. Eastern time, the closing bell rings. At that time, the last trading price for each security on the exchange becomes the closing price.

Why It Matters

The closing price does not necessarily mean the end of all trading on that security for the day. In fact, it simply means the floor of the exchange is closed. After-hours markets remain open, as do other exchanges in other countries and time zones, which provides opportunity for the price to change.